Our view: Illinois needs tax reform
We’re disappointed – but not surprised – that Office Depot chose Florida over Illinois for its corporate headquarters.
The office supply retailer based in Boca Raton, Fla., merged last month with OfficeMax under the Office Depot name. OfficeMax was based in Naperville.
The company said it chose Florida because it thinks it can be more profitable there. Given Illinois’ tax climate, no one should be surprised.
OfficeMax has more than 2,000 corporate employees in Illinois, of whom 1,600 are based in Naperville. Office Depot plans to relocate some portion of those jobs to Florida, but did not say how many.
Before making its decision, the new company sought tax incentives from both states. A tax incentive bill passed the Illinois Senate, but did not get a vote in the House.
Regardless, we do not support a piecemeal approach to luring new businesses or keeping current ones in Illinois.
As we’ve said in the past, these business-by-business negotiated deals are unfair to other businesses, particularly small businesses, which represent a large part of the economy. Continuing to give some big employers major tax breaks while not doing the same for others is not a viable long-term solution for Illinois’ poor business climate.
For Illinois to really compete with other states – and countries – for jobs, it must take a hard look at real tax reform.
Compared to other U.S. states, Illinois ranks 47th in corporate taxes, 33rd in sales taxes, 43rd in unemployment insurance and 44th in property taxes.
Translation? Our taxes are too high.
Combine that with an incompetent General Assembly and ineffective governor, and it’s no wonder we’re losing businesses to other states.
With a watered-down pension reform legislation behind us, perhaps 2014 will be the year for tax reform.
We won’t hold our breath.